Cavenham Pty Ltd v Robert Bax and Associates

Cavenham Pty Ltd brought proceedings against Robert Bax and Associates, asserting that the defendant solicitor had failed to properly advise the plaintiff in relation to a series of loans made to a Gold Coast night club. The plaintiff alleged that the defendant had a duty to ensure that the loans were adequately secured, and that the failure to register a mortgage as agreed resulted in a significant financial loss when the night club was placed into receivership. The dispute was heard in the Federal Court of Australia.

The primary legal issues before the court were the commencement date and scope of the defendant's retainer, whether the defendant breached that retainer, and whether the plaintiff would have proceeded with subsequent loans or demanded repayment of the first loan had they been properly advised. The court needed to determine if the defendant's retainer included duties beyond clerical tasks and whether the plaintiff's financial losses were a direct result of the defendant's alleged breach of retainer.

The court held that the defendant's retainer did encompass duties beyond clerical tasks, as the defendant was retained to provide legal advice on the security arrangements for the loans. The court found that the defendant had breached this retainer by failing to ensure that a mortgage was registered over the property as agreed. Consequently, the plaintiff's losses were directly attributable to the defendant's breach of duty. The court awarded judgment to the plaintiff for the sum of $1,477,420.20, plus costs to be assessed on the standard basis.